Inside Move: Shrek eats Big Macs

McDonalds, D'Works Animation announce 2-year deal

DreamWorks Animation did find something to crow about Wednesday, despite the SEC brouhaha.

Jeffrey Katzenberg’s animation empire nabbed more bragging rights over archrival Disney Animation when McDonald’s, nearing the end of its 10-year, exclusive tie-in deal with the Mouse, announced a two-year, non-exclusive pact with DreamWorks Animation.

First pic to get the Happy Meal treatment under the deal will be “Shrek 3″ in 2007.

DreamWorks will create original animation for McDonald’s commercials and it’s likely that DreamWorks characters will appear in those commercials, something that did not happen with the Disney characters.

McDonald’s is in the midst of a major brand makeover, said Larry Light, executive VP and global chief marketing officer for McDonald’s Corp.Mickey D’s is hoping to get pointers from DreamWorks on how to broaden its appeal.

“The hope is that we’ll have a long-term relationship with DreamWorks,” Light said, “but there’ll be a learning curve. And a long- term commitment is different from a long-term relationship.

“A 10-year commitment, you won’t see that again. We will not be exclusive and we will be flexible.”

McDonald’s has been eager for the end of the Disney pact for some time. Mouse House had a string of animated hits when Katzenberg ran the studio, but he was long gone and had already become a co-founder of DreamWorks SKG when McDonald’s signed its decade-long Disney deal.

Tie-ins with Disney-Pixar pics were a hit for McDonald’s, but the long-term deal turned out to be a lingering headache for the fast-food giant, as franchisees grumbled about being shut out of “Shrek” and “Ice Age” while Disney turned out such flops as “Home on the Range” and “Treasure Planet.”

The deal got a standing ovation from 800 advertising and marketing pros when it was announced Wednesday at McDonald’s annual U.S. Marketing Leadership Meeting.